Impact of business conditions favorability as the imperative for youth employment enhancement

Abstract

Business conditions are usually linked to certain opportunities and restrictions applicable at the national, regional or local level. The business environment, in other words, business conditions or climate, could be described as an open system, the elements of which are hard to identify and define in some cases, especially having in mind that these elements that currently seem to be insignificant might become critical in the future. This allows formulating a scientific problem – to substantiate and measure the impact of changes in business conditions on youth employment opportunities. Business conditions have a direct impact on the employment of individuals on the labour market, the level of wages, the created value added, the wellbeing of the country’s citizens, and other important social and economic indicators. In this respect, the assessment of the level of the favourability of business conditions as the imperative for youth employment enhancement becomes an important part of the analysis. The objectives are as follows: 1) to highlight the impact of the level of the favourability of business conditions on the enhancement of employment; 2) based on different methodological approaches of the assessment of business conditions and different secondary and statistical data sources, to provide an analysis of the business climate in the EU and Lithuania and employment (by emphasising the problems relating to youth unemployment); 3) to determine the favourability of business conditions for entrepreneurship promotion, establishment of business start-ups and/or development of private businesses on the basis of the data of the longitudinal empirical survey conducted among youth in 2012-2013. There is a lack of unanimity on the methodological issue of the assessment of the favourability of business conditions. Also, a large variety of applied instruments and indicators can be observed. The analysis of the empirical survey data revealed that the Lithuania environment-related factors that had the largest impact on the youth’s potential to set up and develop their own business are as follows: the level of employee qualifications and competence, ability to penetrate into new markets, consumer purchasing power, tax burden, and availability of financing sources.